Finance both the purchase and renovation of a property with a single loan that's based on the after-improved value.
Combine your home purchase (or refinance) and renovation costs into a single loan with one closing, one set of fees, and one monthly payment.
Loan amounts based on the home's value after improvements, not just the purchase price, allowing you to finance more extensive renovations.
Turn a fixer-upper into your dream home or transform an outdated property into a modern living space while enjoying attractive financing terms.
Finance cosmetic updates, structural repairs, energy-efficient improvements, room additions, and more based on the specific loan program.
Expert guidance throughout the renovation process, including contractor vetting and project monitoring to ensure quality work and timely completion.
Choose from FHA 203(k), Fannie Mae HomeStyle, VA renovation, and other specialized programs based on your unique situation and renovation needs.
Minimum requirements vary by program: FHA 203(k) typically requires 620+, while conventional renovation loans may require 640-680+.
FHA renovation loans require 3.5% down, while conventional programs typically require 5% minimum. Down payment is based on the total loan amount.
Maximum DTI ratios typically range from 43-50% depending on the program, credit score, and other compensating factors.
Most programs allow single-family homes, 2-4 unit properties, condos, and PUDs. Some restrictions apply for manufactured homes or investment properties.
Eligible improvements must be permanently affixed to the property and add value. Luxury amenities may be limited depending on the program.
Licensed, insured contractors with references are required. Some limited DIY work may be allowed on certain programs for qualified borrowers.
Determine your budget for both purchase and renovation costs. We'll help you understand different renovation loan options and maximum loan amounts.
Find a property that meets your needs and has renovation potential within your budget. Consider structural issues, layout possibilities, and neighborhood potential.
Work with contractors to develop detailed renovation plans and cost estimates. The level of detail required will depend on the specific renovation loan program.
An appraiser will determine the after-improved value based on your renovation plans. The lender will review your complete application for final approval.
Close on your loan and take ownership of the property. Purchase funds are disbursed, and renovation funds are placed into an escrow account.
Contractors complete work according to the approved plans. As work progresses, draw inspections verify completion before renovation funds are released.
Common renovation loan programs include FHA 203(k) Standard and Limited, Fannie Mae HomeStyle Renovation, VA renovation loans, and USDA renovation loans. Each has different requirements, loan limits, and eligible renovation scopes.
Loan amounts are based on the lesser of the purchase price plus renovation costs or a percentage of the after-improved value (typically up to 97% for FHA or 95% for conventional). Maximum loan amounts vary by program and location.
Eligible improvements generally include structural repairs, room additions, kitchen and bathroom remodels, flooring, roofing, HVAC systems, energy efficiency upgrades, and more. Luxury items like swimming pools may be restricted in some programs.
Renovation funds are held in an escrow account and disbursed in draws as work is completed and inspected. The number of draws varies by program, with some allowing multiple draws and others limiting to just a few disbursements.
Most renovation loan programs require licensed contractors for all work. However, FHA 203(k) may allow some DIY work for qualified borrowers, while Fannie Mae HomeStyle® typically does not. Professional contractor oversight is generally required.
Most programs require renovations to be completed within 6 months after closing, though extensions may be possible for larger projects. Work must begin within a specified timeframe after closing, typically within 30 days.
Let's discuss how a renovation loan can help you create the home of your dreams.
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For information purposes only. This is not a commitment to lend or extend credit. Information and/or dates are subject to change without notice. All loans are subject to credit approval. E Mortgage Capital, Inc. d/b/a E Mortgage Capital, NMLS# 1416824. Equal Housing Lender (NMLS consumer access: https://www.nmlsconsumeraccess.org/_)
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A toll-free consumer hotline is available at 1-877-276-5550. The department maintains a recovery fund to make payments of certain actual out of pocket damages sustained by borrowers caused by acts of licensed mortgage banker residential mortgage loan originators. A written application for reimbursement from the recovery fund must be filed with and investigated by the department prior to the payment of a claim. For more information about the recovery fund, please consult the department’s website at